Daily Headlines – November 5, 2012

Written by Jake Johnston

Monday, 05 November 2012 14:23

Before hitting the U.S.’ east coast last week, Sandy wreaked havoc on Haiti leading many to fear a food security crisis, reports the Miami Herald. Coming just nine weeks after Tropical Storm Isaac devastated agricultural crops throughout the country, Sandy inflicted an estimated $70 million in agricultural damages, mostly in the South department. An analysis done by the Haitian government following Isaac found that changing weather patterns were negatively effecting food security in almost every region of the country. Writing in NACLA, Kevin Edmonds discusses how climate change will affect Caribbean countries. Edmonds speaks with University of the West Indies professor Norman Girvan, “30 years ago, one expected to deal with major disasters of this kind, say, once every ten years. Nowadays, most islands expect at least one, and possibly two or three, every year. In other words this now has to be seen as a permanent, recurring phenomenon or integral feature of Caribbean development.” Edmonds notes that despite climate change presenting a significant threat to the Caribbean, the countries lack the power to address to the problem on a global scale.

Speaking at the G-20 summit in Mexico City, Argentina’s Economy Minister called on advanced countries to place restrictions on vulture funds, reports Bloomberg. The call comes after a U.S. court ruled that Argentina must pay vulture funds with the same priority that they pay holders of their restructured bonds, which some 93 percent of creditors accepted following Argentina’s default in 2001. The court ruling, which has been called a huge win for vulture funds, could impact other sovereign debt restructurings. Economy Minister Lorenzino told his fellow ministers, “We hope that G-20 nations understand that the latest developments could affect any future restructuring process of sovereign debt…All nations should be on alert.” Meanwhile, Argentine and South African officials met to discuss NML Capital’s attempts to detain an Argentina ship docked in South Africa. The move by NML Capital, run by billionaire Republican donor Paul Singer, comes after they successfully detained an Argentina naval vessel in Ghana last month.

The Peruvian government is moving forward with plans to pay back billions of dollars in 40 year-old land bonds, reports Reuters. General Juan Velasco issued the bonds as compensation during a land redistribution program started in the 1970s. In 2001, the Constitutional Court ruled that the government should repay the bonds, yet a string of government’s since then have punted on the issue. Now, the payment is becoming more pressing as the U.S.-Peru Free Trade agreement comes into force. Over the years, many of the bonds have been bought by investors on a secondary market. With the “free trade” agreement, the funds which hold the bonds could sue in U.S. courts to seek payment, a similar strategy as vulture funds have employed in Argentina. Constitutional Court president Ernesto Alvarez told Reuters, “There is a worry among some authorities in the executive branch ... that Peru could find itself hurt if complaints were lodged in courts under clauses in the free-trade pact with the United States.” If Peru pays back the bonds, they could be on the hook for up to $8 billion, or 4 percent of GDP.

While Bolivia has benefitted from the emergence of Quinoa as an export product, it has caused problems for the local population, reports Deutsche Welle. Quinoa, a highly nutritious food crop, has become a staple in health food stores across the developed world. Bolivia, with its high plains, is one of very few places where the crop can be grown organically, and supplied over 90 percent of the 6,500 tons exported to the European Union in 2009. While politicians and community organizations have pushed for greater development of quinoa in Bolivia, the increase in external demand has led to sharp price increases for the local population. Jim Schultz, head of the Bolivia-based Democracy Center, notes “As the global demand for quinoa increases, it raises the prices of quinoa here in Bolivia…You actually have low income families that used to be able to feed their children and themselves with quinoa, which is very healthy. Now, they eat white rice and low-quality pasta." For more on the downsides of Bolivia’s quinoa export boom, see Jean Friedman-Rudovsky’s April piece in TIME.